A July 10 sentencing date is set for a Hermosa Beach man convicted of participating in an insider trading conspiracy that used confidential information about an impending corporate acquisition to earn trading profits.
Eric Weller, 54, was found guilty Tuesday by a federal jury in Chicago of one count of conspiracy to engage in insider trading, which carries a possible sentence of up to five years in federal prison. The jury acquitted Weller on three counts of securities fraud, according to the U.S. Attorney’s Office in Chicago.
Weller was among nine defendants charged as part of the federal investigation. Five defendants pleaded guilty to the conspiracy charge prior to trial and are awaiting sentencing. Three others entered into deferred prosecution agreements after admitting their roles in the conspiracy and cooperating with the government’s investigation.
Evidence at trial revealed that a vice president of corporate sales at Minnesota-based Life Time Fitness Inc. obtained material, non-public information about the potential sale of the company in 2015. The executive knew that a sale would likely cause an increase in the company’s stock price, and the executive shared the inside information with a longtime friend so that the friend could trade and profit. The friend shared the information with three co-conspirators, one of whom then shared it with Weller and three others, according to prosecutors.
After receiving the material, non-public information, Weller purchased Life Time Fitness securities before news of the potential sale became public via a media report, according to the U.S. Attorney’s Office. The report caused the stock price to increase substantially.
During a three-week period, the defendants earned more than $860,000 in illegal profits from the trades, including more than $550,000 earned by Weller, according to the U.S. Attorney’s Office in Chicago.
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